CapLease, Wells Fargo Extend Credit Agreement

NEW YORK CITY-CapLease said Monday it has extended its credit agreement with Wells Fargo Bank until July 2013. The $140-million secured revolving credit facility provides more than $40 million to finance new acquisitions, the locally based REIT says in a release. CapLease’s amended credit facility with Wells Fargo posts the interest rate at Libor plus 275 basis points.“We have a longstanding strong relationship with our lender and are very pleased to have completed the amendment to our credit agreement, as it provides us with an additional three years of term at an attractive cost,” chairman and CEO Paul McDowell says in the release. He adds that as part of Caplease’s continued deleveraging strategy, “we lowered our borrowings under the facility by an additional $13.4 million, to $96.4 million, using cash on hand to further reduce recourse liabilities. “In addition to our over $55 million of cash on hand, this facility increases our financial flexibility and capacity to fund future portfolio investments as we restart our efforts to grow the portfolio.”This past April, CapLease closed on common and preferred stock offerings, which raised a total of $55 million. Part of that was used to make the $13.4-million paydown on the company’s debt. The additional stock did dilute CapLease’s first-quarter funds from operations, announced May 5. FFO for Q1 this year reached $9.2 million, or 17 cents per share, compared with FFO of $8.8 million, or 19 cents per share, the year prior. The company had about 53 million common shares outstanding at the end of Q1, up from 47.4 million at the end of 2009’s first quarter. Additionally, the company paid about $13.5 million in May to buy back all of its outstanding 7.5% convertible senior notes due 2027.